Goldman Raises Oil Demand Outlook

Authored by Irina Slav via OilPrice.com,

• Goldman Sachs has increased its global oil demand forecast but maintained its price predictions for Brent crude and WTI for the current year, despite current trading values exceeding those projections.

• The potential for a US-Iran nuclear deal and the progression of the tariff war are significant factors creating uncertainty in the oil market, influencing forecasts and potential price fluctuations.

• Future oil prices could drop significantly if the tariff war worsens and OPEC Plus restores its previously cut oil supply, according to Goldman Sachs analysts.

Goldman Sachs analysts have revised their outlook for global oil demand upwards, now expecting growth of 600,000 barrels daily this year and 400,000 barrels daily in 2026.

The bank, however, maintained its oil price forecast at $60 per barrel of Brent crude and $56 per barrel of West Texas Intermediate for this year, Reuters reported, citing a new note. 

Brent crude was trading at over $65 per barrel at the time of writing, and WTI was trading at over $62.

Goldman’s analysts expect the benchmarks to fall further next year, to $56 for Brent crude and $52 for WTI. 

A big reason for the bearish outlook is the nuclear deal between the U.S. and Iran that recently became a more distinct possibility than it was until now. 

Last Thursday, President Trump the two sides were really close to sealing such a deal. 

The news dealt a blow to oil prices.

Later updates, however, tamed any optimism as they revealed persistent differences between the two sides on what conditions they would accept. The U.S. side insists on Iran committing to stop any uranium enrichment activities. The Iranian side considers its uranium-enrichment activities non-negotiable.

However, the prospect of a shorter rather than longer tariff war has improved the outlook for global growth, which could offset any bearish supply effect stemming from a U.S.-Iran nuclear deal by improving demand for crude, per Goldman. 

This was the basis for their upward revision of demand for the second half of the year, or, as they put it, “Incorporating lower tariffs and higher GDP.”

On the other hand, if the tariff war drags on and comes to affect global economic growth in the physical world rather than the realm of forecast, the investment bank expects Brent could drop as far as $40 per barrel in late 2026. 

For that to happen, OPEC+ must also bring back all the barrels it cut from its combined supply back in 2022, Goldman analysts noted.